So, who votes for a government that improves the lives of Bankers, and ensures the excessive profits of energy companies, but needs all the "levelling up" money to pay for the holes in Brexit?

I seem to recall, Maizie, that I asked you where all the tax the bankers pay goes to - perhaps you would reply.

I told you a page or two back.

All that anyone's tax does is to reduce the Treasury's debit balance at the BoE. Which means that the BoE has to pay out less in new money to keep the economy going.

Profits of investment banks come from the interest charged on loans and fees charged for their services. As these are paid by the commercial enterprises that use the loans they obtain from them where does the money they use to pay the interest and fees come from? It doesn't materialise out of thin air.

The problem is that the rich do not necessarily pay the same amount of tax. The system is not equal or based on income as some imagine.
From the LSE article I linked to earlier.
Using anonymised data from personal tax returns, we show that in 2015-16 the average rate of tax paid by people who received one million pounds in taxable income and gains was just 35 per cent: the same as someone earning £100,000. But one in four of these paid 45 per cent – close to the top rate – whilst another quarter paid less than 30 per cent overall. One in ten paid just 11 per cent—the same as someone earning £15,000. The rich, it seems, are not all in it together
Does anyone really think that's acceptable.

MaizieD

^How much of that profit finds its way into the pockets of the man or woman in the street?^

A more pertinent question, growstuff and one that I was trying to tease out the answer to, is:

'How much of that profit came out of the pocket of the man in the street?'

Profits of investment banks don’t come out of the pocket of the man in the street. Some - not all - profits of retail banks come from interest paid on loans, which has been at historically low rates for years, and payment of fees. I pay fees for my banking, for the service I get.

I seem to recall, Maizie, that I asked you where all the tax the bankers pay goes to - perhaps you would reply.

Oh dear I missed a few pages that was in answer to we can't all be care workers

made worse by brexit

obviously not as there is a massive shortage of carers/support workers

Thank you for this Dinahmo.

From The National

' THE Tories have been accused of trying to fill the pockets of "friends and donors" over prioritising the cost-of-living crisis after it emerged that they are considering scrapping the cap on bankers' bonuses.

Kwasi Kwarteng, the new Chancellor, is reportedly mulling plans to scrap the cap on bankers’ bonuses introduced by the EU in 2014 in what is thought to be a bid to attract more financial supremos to London.

But critics of the rumoured plan – which was first reported in Thursday’s Financial Times – have said it amounts to gifting cash to the super-wealthy while ignoring families “burdened with unmanageable levels of debt due to rocketing bills and food prices”.

Alison Thewliss, the SNP’s Treasury spokesperson, said: “If true, these shameful plans show once again that the Tories are more interested in putting more money into the pockets of their friends and donors in the City while turning their backs on ordinary households struggling across the UK.”

The concluding comments taken from a paper produced by the LSE on the subject of reducing taxes for the rich :

The paper, published by LSE’s International Inequalities Institute, uses data from 18 OECD countries, including the UK and the US, over the last five decades. The Economic Consequences of Major Tax Cuts for the Rich, by David Hope and Julian Limberg, shows that the last 50 years were a period of falling taxes on the rich in the advanced economies. Major tax cuts were spread across countries and throughout the observation period but were particularly clustered in the late 1980s.

"It states: “Our results show that…major tax cuts for the rich increase the top 1% share of pre-tax national income in the years following the reform. The magnitude of the effect is sizeable; on average, each major reform leads to a rise in top 1% share of pre-tax national income of 0.8 percentage points. The results also show that economic performance, as measured by real GDP per capita and the unemployment rate, is not significantly affected by major tax cuts for the rich. The estimated effects for these variables are statistically indistinguishable from zero.”

It continues: “Our findings on the effects of growth and unemployment provide evidence against supply side theories that suggest lower taxes on the rich will induce labour supply responses from high-income individuals (more hours of work, more effort etc.) that boost economic activity. They are, in fact, more in line with recent empirical research showing that income tax holidays and windfall gains do not lead individuals to significantly alter the amount they work.”

The authors conclude: “Our results have important implications for current debates around the economic consequences of taxing the rich, as they provide causal evidence that supports the growing pool of evidence from correlational studies that cutting taxes on the rich increases top income shares, but has little effect on economic performance.”

Dr Hope, Visiting Fellow at LSE’s International Inequalities Institute and Lecturer in Political Economy at King’s College London, said: “Our research shows that the economic case for keeping taxes on the rich low is weak. Major tax cuts for the rich since the 1980s have increased income inequality, with all the problems that brings, without any offsetting gains in economic performance.”

Dr Limberg, Lecturer in Public Policy at King’s College London, said: “Our results might be welcome news for governments as they seek to repair the public finances after the COVID-19 crisis, as they imply that they should not be unduly concerned about the economic consequences of higher taxes on the rich.”

The countries studied in the paper are Australia, Austria, Belgium, Canada, Germany, Denmark, Finland, France, Ireland, Italy, Japan, the Netherlands, Norway, New Zealand, Sweden, Switzerland, the United Kingdom, and the United States. "

How much of that profit finds its way into the pockets of the man or woman in the street?

A more pertinent question, growstuff and one that I was trying to tease out the answer to, is:

'How much of that profit came out of the pocket of the man in the street?'

vegansrock

Well the bank could just pay a higher salary and the employees would get a higher bonus.

So, is that what you would like them to do vegansrock?

Well the bank could just pay a higher salary and the employees would get a higher bonus.

Germanshepherdsmum

How does removing the cap on bankers’ bonuses result in anyone ‘having more at the price of others having little or none’, Daisy?

Are you kidding or just being obtuse?

Germanshepherdsmum

Whether they find the UK attractive depends very much on what products or services they supply, and where they intend to make the supply.

No, I don’t approve of a low wage economy but that’s not what I have been talking about.

So you approve of the UK becoming like many developing countries? Companies are foreign-owned, use cheap local labour and sell the goods abroad.

Germanshepherdsmum

How else can you explain the focus on lifting the cap on bankers’ bonuses, which will cost the taxpayer - and non-taxpayer - absolutely nothing?

Don't be silly! Do you think bankers create extra wealth? It's wealth which is siphoned out of the country's economy.

Germanshepherdsmum

Maizie - take car manufacturers for instance - products sold here and overseas.
And banks make their money from all manner of trading and commercial loan arrangements. It is investment banking, not retail banking, which produces the big profits.

How much of that profit finds its way into the pockets of the man or woman in the street?

This should be a success, regarding vehicle sales home and abroad

Germanshepherdsmum

Maizie - take car manufacturers for instance - products sold here and overseas.
And banks make their money from all manner of trading and commercial loan arrangements. It is investment banking, not retail banking, which produces the big profits.

OK

How many people in the UK in the middle of a financial crisis are going to buy new cars? And what export markets do we have that would attract that car maker? Especially now we've cut our noses off to disengage from the enormous market on or doorstep?

Those commercial loans. Where are the companies who take them on going to get the money to repay them with?

Retail banks may not be 'so' profitable, but where is the money to repay £1,5 trillion of mortgage debt + interest coming from?

Germanshepherdsmum

Whether they find the UK attractive depends very much on what products or services they supply, and where they intend to make the supply.

No, I don’t approve of a low wage economy but that’s not what I have been talking about.

Widening inequality can affect both growth and stability. It concentrates political power and decision-making in the hands of a few. It can lead to poor use of human resources and can cause investment-reducing political and economic instability. The idea that a small group, getting ever more unequal in reward will create additional greater good than harm with each increase in their reward, is, at the very least, ill thought through.

I would think most people would understand that there is a point where widening inequality will cause the risk of a crisis or possibly a revolt. I suggest if being ever richer is the only guide someone has, they look to Russia, France, etc.,

Maizie - take car manufacturers for instance - products sold here and overseas.
And banks make their money from all manner of trading and commercial loan arrangements. It is investment banking, not retail banking, which produces the big profits.

From the Tax Justice Network

'This loose offshore interest group also includes Jacob Rees-Mogg, an upper-class pro-Brexit politician who has been co-owner of a major offshore investment firm; Richard Tice, leader of the Brexit Party whose family has deep offshore links, and a few others.

These people, and the often mysterious money behind them, were a significant factor behind Brexit: it is quite easy to argue, given the narrowness of the vote, that their influence flipped the vote from Remain to Leave.

If there is an ideology for these hardliners, it was perhaps first espoused by Rees-Mogg’s father William, author of a book called The Sovereign Individual, a favourite of Silicon Valley libertarian times. The book foretold ever greater difficulties financing welfare states as mobile capital increasingly escaped the grubby bonds of the democratic state. Subscribing to the fictional Littlefinger’s “Chaos is a Ladder” theory of getting rich, the book urged the talented, privileged “sovereign individual” to thrive by embracing the offshore mystic, by cheerleading chaos, and by advancing the offshore project itself.'

Germanshepherdsmum

How else can you explain the focus on lifting the cap on bankers’ bonuses, which will cost the taxpayer - and non-taxpayer - absolutely nothing?

Try again.

Where do the banks get their profits from?

No tax avoidance here fleurpepper. Not a penny.

Whether they find the UK attractive depends very much on what products or services they supply, and where they intend to make the supply.

So I refer you to the questions you haven't answered.

Where is the attractive market for this investment?

Also to the unanswered question about where the banks get their profits from.

Germanshepherd'smum says : 'I earned a lot as a City lawyer but didn’t find that unconscionable. '

neither do I- why should anyone. What I do object to, very strongly, is how many (bravo if you did not) - find any loopholes to pay as little tax as possible, even worse avoid as much tax as they can, or hide their profits abroad to pay no tax in UK (as many in the Government- as well as the Cons party. Which is what Brexit was all about btw).

How else can you explain the focus on lifting the cap on bankers’ bonuses, which will cost the taxpayer - and non-taxpayer - absolutely nothing?